KUALA LUMPUR (Jan 20): The resurgence of Covid-19 cases this month brings renewed uncertainty for Malaysia’s economic recovery path, and with that the prospects of the labour market.
Last week, the Department of Statistics Malaysia said Malaysia’s unemployment rate rose a marginal 0.1 percentage point month-on-month to 4.8% in November 2020 – a five month high – with 764,400 people unemployed.
Subsequently, economists raised their forecasts for this year’s unemployment rate, as they expect a slower recovery, following the reimplementation of the movement control order (MCO). UOB Malaysia has revised its jobless rate projection to 4% from 3.7% previously, while MIDF expects it to come in at 3.8%.
While businesses navigate fierce headwinds driven by the pandemic and seek ways to adapt their business to the new norm – like going digital by establishing online platforms – those seeking new jobs in this difficult period should equip themselves with the right skills to stay relevant in the job market, said economists.
In particular, they should pick up skills and knowledge in ICT and online marketing that will help companies withstand current and future shocks, said MIDF Research economist Abdul Mui’zz Morhalim.
Essentially, skills trend will follow widely anticipated post-pandemic digital transformation and automation to reduce dependency on foreign workers, as well as an increase in e-commerce readiness to shift up the value chain, said Sunway University economics professor Dr Yeah Kim Leng.
These business needs, said Yeah, will underpin employers’ staff recruitment. They will be looking for employees who are equipped not only with the necessary technical and digital skills but also the ingenuity, innovativeness and creativity to apply new technologies and thinking to improve their business efficiency, productivity and competitiveness, he said.
Selling as a skill will also continue to be the most wanted by employers, said Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid. And being versatile in trying out different sectors and industries outside one’s trained field, can also help increase job prospects, he said.
“Such skill sets are quite universal to any industry and cannot be fully replicated by technology. This involves the ability to communicate convincingly and to demonstrate high competencies in one’s field,” Mohd Afzanizam said.
Some time to go before unemployment rate normalises
Sunway University’s Yeah said prospects for the job sector should improve considerably, once a safe and effective vaccine is made widely available. “Given that mass vaccination in Malaysia is expected to begin in February or March, the earliest we can expect for some normalisation of the country’s economic activities is in the second half of 2021,” he said.
But this means it will take awhile before the country’s jobless rate reverts to between 3% and 3.3%, said Mohd Afzanizam. Generally, an economy with an unemployment rate of 3% or less is considered at full employment.
Yeah thinks pulling down the unemployment rate to an average of 3.5% or below by end-2021, as targeted by the government, would be hard to achieve, if the economy experiences a U-shaped rather than a V-shaped recovery. The government has estimated that the unemployment rate for 2020 would come in at 4.2%.
“Although retrenchments have been stabilised by the government’s roll-out of a series of fiscal and monetary stimulus packages, which continued with an expansionary budget for 2021, the economy is not out of the woods until the pandemic is suppressed effectively,” Yeah noted.
Likewise, MIDF’s Abdul Mui’zz thinks the latest data shows it will take time for the unemployment rate to return to pre-pandemic levels. “We foresee that the unemployment rate will fall to below 4% next year, as the general economy is expected to recover. However, the pace of recovery will be subject to the success of containing the Covid-19 pandemic,” he said.
Still, businesses remain in business by staying ahead of the curve, noted Mohd Afzanizam. So recruitments will continue, he said, as companies will not want to lose their competitiveness. In fact, the current uncertain job market is an opportunity for them to gain the right talents to gain a bigger market share, once the situation normalises.